Forex Today: Demand for safe-haven assets persists amid escalating Middle East tensions

Thursday, March 5: Key Market Updates

On Thursday, March 5, financial markets continue to display caution as tensions escalate in the Middle East. While the US economic calendar offers several mid-level data releases, investors remain attentive to ongoing geopolitical developments.

Recent reports indicate that a US submarine sank an Iranian warship near Sri Lanka on Wednesday, and NATO air defense systems intercepted an Iranian missile approaching Turkish airspace. In the US, the Senate voted against a resolution that would have required President Donald Trump to obtain congressional approval for any further military action against Iran. According to CNN, a senior US official revealed that the US is preparing to conduct deeper strikes within Iran, with the operation still in its initial phase.

Commodities and Currency Market Movements

• Crude Oil: Oil prices have climbed for a fourth straight day. West Texas Intermediate (WTI) crude is trading at $77.15 per barrel, up approximately 1.4% for the day.
• US Dollar (USD): After a brief pullback on Wednesday, the US Dollar Index has regained upward momentum, trading above 99.00 and rising about 0.3% early Thursday. Recent US data showed the ISM Services PMI increased to 56.1 in February from 53.8 in January. Additionally, ADP's Employment Change report for February recorded 63,000 new jobs, exceeding the forecast of 50,000. The Department of Labor is set to release the latest weekly Jobless Claims figures later today.
• Gold (XAU/USD): After significant losses earlier in the week, gold prices stabilized and posted modest gains on Wednesday. On Thursday morning in Europe, gold remains steady above $5,150.

Major Currency Pairs

• EUR/USD: The euro recovered slightly on Wednesday, ending a two-day decline, but has since lost momentum and is trading near 1.1600 in early European hours.
• GBP/USD: The British pound is under pressure, falling toward 1.3300 as the US dollar strengthens once again.
• USD/JPY: The dollar has bounced back against the yen, moving into positive territory above 157.00 after earlier weakness in the Asian session.